6 marketing and research lessons for sophisticated selling of digital subscriptions

As news organizations increasingly rely on subscription revenue, this shift demands a new approach toward audience. Publishers must understand user behavior better, take advantage of analytics and be more audience focused.

A leading market economist and two executives from the New York Times outlined increasingly sophisticated methods to hone in on reader preferences during a recent American Press Institute symposium. These methods helped The Times’ 2-year-old digital subscription plan gain traction and positioned the media organization to create more personalized digital experiences for users.

Shane Murray, the Times’ executive director of analytics, James Dunn, executive director of digital subscription marketing for the Times and Matthew Lindsay, managing partner of Mather Economics who works with hundreds of media companies on their pricing strategies, supplied data and insights. API identified six key takeaways from these speakers’ remarks:

1. Modern marketing is an entirely new way of looking at the relationship between brands and customers

The rules encourage two-way communication with users, as opposed to the brand simply pushing promotional material to its audience. For instance, one of the rules is for marketers to provide ways for customers to spread the word about a product to their networks. Word-of-mouth endorsement is more genuine and potentially more effective.

Dunn also advocates for one-to-one experiences. Instead of appealing to a mass audience, a brand should seek to connect with individuals based around their preferences. This is becoming increasingly possible through technological advances that allow for personalization.

Another essential rule revolves around listening to what’s being said by the public about brands’ work and products. This means monitoring social media for chatter and then responding in a professional way when appropriate.

News organizations can apply all these ideas as they try to develop news products and customer service skills for a paying audience.

Most newspapers are reducing the number of free articles they’re allowing users to view, as they discover that meter thresholds of 15 or greater are too high for most users to hit.

By lowering a meter threshold, publishers can push for more subscription sales. On a typical newspaper website, 83 percent of consumers read 15 or fewer articles per month, according to Lindsay. In fact, 93 percent of unique users consume fewer than five page views.

However, a lower meter limit also produces a lower conversion rate. Lindsay’s research indicates that an individual user who hits the meter at 20 articles is more likely to become a digital subscriber, because the user is more engaged and sees the value of the product. On the other hand, setting the meter at 20 means fewer people ever will be asked to pay.

There are also subtle differences in the types of content read by subscribers versus non-subscribers. Based on Lindsay’s sample of local newspaper clients’ websites, subscribers primarily come for local news, sports, editorials and political coverage – content not a lot of other media sources provide. The nonsubscribers tend to read entertainment, travel, technology and business coverage, Lindsay said, which is more easily found across the web.

3. Loyalty programs can differentiate your product from similar alternatives

As an example, Lindsay cited airline loyalty programs. Although the experience of taking a flight does not vary considerably from one airline to the next, frequent-flyer programs help to bind customers to one airline.

In that same way, Lindsay said, loyalty programs make sense strategically for digital publishers trying to set themselves apart and give something special to customers as an extra incentive to return to their product. With print, “there aren’t any other substitutable alternatives,” he said, which makes a loyalty program less necessary.

The Times is considering a loyalty program, according to Tim Griggs, executive director of cross-platform monetization. The details are still being worked out, but such a program would reward users to “give them a velvet rope experience.” For instance, that could entail more access to Times journalists and the availability of special content such as Snow Fall in advance of the general public.

4. Centralizing analytics and customer insights, instead of just placing this expertise within a single division like advertising, allows staff to uncover deeper customer insights

Five teams at the Times fall under the umbrella of the Customer Insights Group: customer analytics, data mining, optimization, web analytics and newsroom analytics. By keeping these groups centralized, Murray said, the company is able to “unify understanding of the customer across all experiences.”

“We can measure the impact and resonance of news and provide insights into how readers consume New York Times content,” he noted.

Each group also goes through a standardized process of reporting, analyzing, monitoring and predicting data in its specific focal area.

Multivariate testing is similar to A/B testing in conceit, but tests more than two variables. This type of testing looks at an array of attributes on the page to ascertain user behaviors and preferences. The Times employs multivariate testing of headline displays, calls to action and other text items on a website simultaneously, Murray explained.

This style of testing saves time. If executed correctly, he said, it takes no longer than A/B test, plus you can measure effects from multiple attributes rather than asking users about them in a vacuum.

6. Telemarketing and other old marketing tactics have mostly been replaced by more innovative approaches

The Times has largely shifted away from telemarketing as a way to acquire customers, said Dunn, the executive director of digital subscription marketing. Modern marketing is practically the antithesis of this former staple.

Now his newspaper company markets itself using a mix of online, social media and emerging technologies like programmatic ad buying. Dunn also provided a few examples of more out-of-the-box ways his team has promoted the Times. This includes prepaid digital subscription gift cards along with a “Share the Times” campaign designed to let subscribers give subscriptions to friends. The cards provide a gift code for a free subscription, and the Times gets an opportunity to upsell recipients when they redeem it. So far, between 10 and 30 percent of the prepaid gift card recipients have upgraded to paid subscriptions, according to Dunn.

The Times also has taken a creative approach to event promotions. At this year’s South by Southwest Festival, staff created a Wordcloud portrait app. When someone came to the company’s booth they were able to take a photo and select a topic of interest. Then, staff tapped content from the Times’ archives to create a Wordcloud portrait of the person, which they could take home. The portraits were a highly talked-about item that generated buzz around the media company and spurred South by Southwest attendees to purchase digital subscriptions.